According to new data from S&P Case-Shiller, home prices grew at a slower pace in April, suggesting that the red-hot housing market may be cooling.
Home prices are up significantly from last year but could cool by the end of the decade.
Home price growth slowed in April, rising 20.4% compared to last year but down from a 20.6% growth rate in the previous month.
For the first time in five months, most of the 20 cities in the index saw a monthly decline in price gains, with the South seeing the biggest increases.
The Case-Shiller index reports on a two-month delay and constitutes a three-month moving average of repeat sales data.
The average rate on the 30-year fixed mortgage went up from 3% in January to 5% in April, but then went back up to 6 percent in June.
With a limited inventory of houses for sale, demand to purchase homes continues to far exceed supply, despite rising mortgage rates.
In a recent note, Craig Lazzara said that mortgage financing has become more expensive due to the Federal Reserve raising interest rates.
There were initial signs of a deceleration in the growth of U.S home prices. A more challenging macroeconomic environment may not support extraordinary home price growth for a long time.
A key indicator of housing market activity--pending home sales--saw a surprise jump in May, reversing six straight months of declines. The housing market is clearly undergoing a transition with home sales and mortgage applications down significantly from last year.
The housing market is going through a transition.
New Home Sales Unexpectedly Rise, but Housing Market Still 'Cratering'.
The existing home prices hit a record.
The housing market could be "torpedo" in the U.S.
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